Tight Global Oil Supplies Turn Syria into an International Problem

I've been watching old episodes of The West Wing, the acclaimed television series about life and work in the West Wing of the White House. In one sequence of shows, bombers kill two U.S. congressmen and a former chairman of the Joint Chiefs of Staff who are on a fact-finding mission to Gaza. Pressure mounts from both political parties in Congress, from the public and even from the president's own staff for a retaliatory military strike.

But the president doesn't like his options, and he delays. Violence will just beget more violence. Is there a way to bring the bombers to justice without killing innocent civilians and entangling the United States directly in the Israeli/Palestinian conflict as a combatant rather than a broker for peace?

I believe that the Syrian regime's use of chemical weapons is merely a pretext for American intervention despite all the hoopla about the president's rather vaguely worded "red line" warning about chemical weapons to Syria last year. (Need I recount the simmering conflicts and resulting tragedies around the world in which the United States chose NOT to intervene?) One always suspects that oil is the real issue when it comes to the Middle East. So, let's see if that's the case here.

According to the U.S. Energy Information Administration (EIA) in 2010 before the civil war drove down oil production, Syria was the 34th largest oil producer in the world--behind Thailand, but just ahead of Vietnam. Syria's oil production of 367,100 barrels per day (bpd) represented about one half of one percent of world oil production--small in the overall picture. But it is more instructive to see what Syria's neighbors produce. (All oil production and ranking numbers are based on EIA figures for crude including lease condensate which is the definition oil.)

The general idea that Syria's neighbors hold the keys to a lot of oil certainly comes as little surprise to anyone with a cursory knowledge of the Middle East. But, the salient fact about the Syrian conflict is that it is a civil war. So, why is an American president so concerned about a war within the country?

The split isn't just between countries that are predominantly Shia and predominately Sunni. It is, as Syria is showing, a split within many Arab nations which have citizens of both sects. So, there is not only the potential for conflict between nations in the Middle East, but also for the spread of civil unrest and civil war to other nations in the region. Iraq continues to demonstrate that this fear is not just hypothetical as bombings perpetrated in the name of minority Sunnis continue to vex a country which has experienced a long civil conflict between Shia and Sunni after the U.S. invasion.

The spread of that kind of chaos would be very bad for oil supplies. Witness what has happened to Syrian oil production. It has fallen from 367,100 bpd in 2010 to just 157,200 bpd as of the end of last year. That's a decline of 57 percent in two years. That kind of decline in Middle East oil production would have catastrophic effects on an already iffy world economy, one absolutely dependent on oil for its smooth functioning.

But, there is one final consideration. After all we've been hearing about American energy independence, about growing domestic oil production, and about America being able to disengage from oil-exporting dictatorial regimes in the Middle East and elsewhere, the president seems as engaged as ever in the region.

There are three reasons for this: First, right now the United States imports just under half its oil needs. We produce a little over 7 million bpd and consume about 14 million bpd. Second, no realistic nonindustry assessment of future U.S. oil production suggests we'll stop needing substantial imports. Third, oil is traded in a world market, and its price is determined by world supply and demand. Any disruption in Middle Eastern oil supplies would lead to much higher prices which would ripple through the U.S. economy no matter how much we produce domestically.